What’s next and what it means for the country?

The passing of Iran’s Supreme Leader Ayatollah Ali Khamenei initiates a formal succession process that could have far-reaching consequences for the country’s political stability, sanctions outlook, and already struggling economy.

Khamenei, 86, was reportedly killed in a joint military operation by Israel and the United States, as confirmed by Iranian state media. His death marks the end of a tenure that began in 1989 following the death of Ayatollah Ruhollah Khomeini. Despite not being the obvious successor initially, Khamenei rose to power after a constitutional revision allowed for a leader with expertise in Islamic jurisprudence and political acumen.

During his reign, Khamenei centralized authority over key state institutions, promoting a “resistance economy” to counter Western sanctions and maintaining a security-focused approach that stifled dissent. However, his leadership faced challenges, including mass protests in 2009 and 2022, as well as widespread unrest due to economic grievances in late 2025.

Following Khamenei’s demise, Iranians expressed mixed emotions, with some hoping for a new chapter in the nation’s history. However, experts caution that his death does not guarantee immediate transformation, as the Islamic Revolutionary Guard Corps remains a dominant force in Iranian politics.

The leadership transition in Iran is described as historically significant but uncertain, with potential outcomes ranging from regime continuity to collapse. While some anticipate a shift towards liberalization, immediate prospects for political and economic reform appear limited.

Analysts suggest that a new Supreme Leader may face challenges in navigating economic policy and international relations, with the Iranian opposition in exile remaining fragmented and lacking unified leadership. The future trajectory of Iran hinges on the succession process and the stance adopted by the incoming leadership towards internal reform and external relations.